The FGB Digest brings you the latest news on the world’s fastest growing direct-to-consumer and challenger brands. In today’s edition: Adidas makes third of sales through DTC channels; Revolut launches gold exposure feature; and Global businesses continue to close stores in wake of coronavirus.
Adidas makes third of sales through DTC channels
Adidas now makes a third of its sales directly-to-consumer, the brand said as it reported a lift in full-year sales and profits.
That includes e-commerce, which grew by 34% to almost €3bn during 2019, while direct-to-consumer revenues, across channels including its stores, were up by 18% overall. Overall revenues – across all channels – grew by 8% to €23.6bn, or 6% on a currency neutral basis. Growth came primarily online and through expansion of its greater China business, where sales grew by 18%.
However, the forecast, in results published this week, does not yet reflect the impact of the coronavirus outbreak, which started in China but has since spread to Europe and the US – and Adidas says that forecast will be liable to change.
Adidas says its business in Greater China performed strongly in the first three weeks of 2020 but since then it has experienced “a material negative impact on its operations” following the coronavirus outbreak. Footfall has been down while “a significant” number of directly-operated and third-party shops closed. Revenues in the Greater China business were about 80% down on the previous year in the period between 25 January and the end of February.
Revolut launches gold exposure feature
Revolut works with a gold services partner (London Bullion Market Association) so that money you spend on gold exposure is backed by real gold held by this partner. In other words, you’re not going to receive gold coins in the mail. You can just invest money based on the price of gold.
The startup has been building a financial hub and already lets you purchase cryptocurrencies and buy public shares. Gold is part of a new feature called Commodities.
There are multiple ways to invest in gold. You can purchase gold exposure directly at market price, set a limit price to auto-exchange gold when it reaches a certain price or get cashback in gold for Metal customers.
At any time, you can convert your gold investment back into fiat currencies or cryptocurrencies. If you spend money with your Revolut card and you only have gold, Revolut will use your gold exposure automatically. You can also transfer gold exposure to another Revolut user.
Global businesses continue to close stores in wake of coronavirus
Following the announcement by Apple earlier this weekend to temporarily close its US stores and those outside Greater China, Nike is shuttering its own stores. The sportswear retailer said Sunday it will be closing stores in US, Canada, Western Europe, Australia and New Zealand “to limit the spread of the coronavirus”.
Nike is one of many brands, both new and established, that announced the difficult decision to close stores to prevent further spreading of COVID-19. Along with Apple on Saturday, direct-to-consumer brands Everlane, Allbirds and Warby Parker told consumers via email they will be closed for roughly two weeks. Last week, Glossier also announced they were closing stores due to the outbreak.
Glossier founder and CEO Emily Weiss has announced a two-week minimum closure for the London, New York, Los Angeles and Atlanta stores and pop-ups. An Arizona pop-up, due to open next week, will also be delayed.
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